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Basic income sustainability and productivity growth in cognitive capitalism:
An initial theoretical framework
by Andrea Fumagalli
and Stefano Lucarelli
Abstract: This paper aims at proposing a first theoretical framework for studying the basic income sustainability in a cognitive capitalism. Following the French Regulation School approach, we assert that the social compromise between capital and labour is founded on the redistribution of the productivity gains. Therefore we try to trace living standards and social well being problems back to their origins, i.e. productivity growth. We think that describing the dynamics of productivity means understanding the main features of the contemporary capitalistic production. We focus on the socio-economic transformation of western countries and propose the term cognitive capitalism (CC) to describe the economic system after the Fordism paradigm crisis, highlighting the strong links between the exploitation of knowledge and the accumulation of surplus.
Therefore we investigate the presence of a new type of Kaldor-Verdoorn law in cognitive capitalism (a virtuous circle among Basic Income, increasing productivity - via knowledge and network externalities – output and employment). As a result, we first point out the ambiguous growth circle of contemporary capitalism. Secondly we highlight that Basic Income is compatible with the new way of accumulation, based on the exploitation of dynamic economies of scale. Basic Income increases productivity, through network (externalities) and learning processes and, at the same time, demand, via consumption level. This double result is not always guaranteed. It depends, on one side, on how much Basic Income positively affects productivity, and the greater this probability, the lower the role played by intellectual property rights and the higher the diffusion of network economies (general intellect and social cooperation); on the other side, it depends on the way Basic Income is financed.
CV: Andrea Fumagalli (1959) is Professor of Economics at the University of Pavia, Departments of Economics. He is involved in research activity on labour transformations, macroeconomic analysis and innovation theory. He is co-author (with Maurizio Lazzarato) of "Tute bianche", Derive Approdi, Rome, 1999, a book which introduced in Italy the debate on basic income. Among other publications, see: (with Sergio Bologna), Il lavoratore autonomo di seconda generazione", Feltrinelli, 1996, "Bio-economics, labour flexibility and cognitive work: why not basic income?" in G.Standing (ed.) Promoting Income Security as a Right: Europe and North America, Anthem Press. London, 2005, pp. 337-50. He writes articles in the journals Posse, Multitudes and other magazines linked to the no-global movement.
Department of
Economics,
University of
Pavia,
Via San Felice 5,
27100 Pavia,
Italy
E-mail: [email protected]